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Publication Detail
ACPC MS 2002-04: ACPC Position on the Proposed Farmer's Trust System

To address the problem of declining private investments in the agriculture sector, a proposal was raised for the adoption of a Farmers' Trust System, which aims to provide a market-driven institutional mechanism that will bring together farmer groups, private enterprises and agri-based companies for the purpose of consolidating a raw material base and post-harvest and processing facilities under one integrated business unit in the form of a Trust Enterprise. The proposal, however, suffers from some basic flaws, including its focus on the premise that the "smallness of farm production units" is the reason for the problem in agriculture. The more important factors that influence the profitability of agriculture and other rural-based projects are government's inadequate provision of such fundamental public goods as roads that provide access to markets; irrigation systems that lessen the unpredictability of agricultural yield; economically sound and consistent policy and regulatory frameworks that would provide guidance as well as protection to stakeholders in the sector; and the improvement and maintenance of peace and order conditions. Hence, the proposed strategy of consolidating lands alone is not expected to result in any significant improvement in the viability of agriculture-based businesses.

Agricultural Credit Policy Council
Authors Keywords
ACPC; rural credit; agricultural credit; Farmers' Trust System;
Download PDF Number of Downloads
Published in 2002 and available in the ACPC Library or Downloaded 426 times since November 25, 2011
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